MicroStrategy has stuck to its bitcoin strategy through thick and thin. At this point, each decline appears to be a buying opportunity for the firm, which has thrown its weight entirely behind bitcoin. Its CEO Michael Saylor is an extremist who believes that the future is bitcoin. MicroStrategy has been increasing its bitcoin investments during the year, gaining a string of over 100K bitcoins.
Even now, the company continues to straighten its position in digital assets. CEO Michael Sayer announced that the firm has purchased another 5,050 bitcoins, bringing the company’s total assets to approximately 114,042 bitcoins. 5,050 bitcoins were purchased for approximately $242 million, with an average price of $48,099 per BTC. This brings the company’s total digital assets to $3.6 billion. All are received at an average price of $27,713 per coin.
MicroStrategy has purchased an additional 5,050 bitcoins for ~$242.9 million in cash at an average price of ~$48,099 per #bitcoin. until 9/12/21 we #hodl At an average price of ~$27,713 per bitcoin, ~114,042 bitcoins were received for ~$3.16 billion. $mstrhttps://t.co/2ESbTy6ad7
— Michael Saylor⚡️ (@michael_saylor) September 13, 2021
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MicroStrategy has declined to sell its crypto holdings at any time. It seems that accidents do not phase out the firm as they invest even more in the asset with every price drop. This latest acquisition shows their commitment to the long-term development of bitcoin. Sailor has both personal and institutional interest in the asset and is one of the most vocal corporate proponents of the digital currency.
MicroStrategy is taking all the right steps
MicroStrategy has now abandoned traditional assets in favor of investing in bitcoin. A report from Bitcoinist suggests that it would be profit-wise if the firm chose to invest in one of the most well-known traditional investments, gold, instead of investing in bitcoin. Since bitcoin has outperformed gold by at least 200% year on year over the past few years, Microstrategy’s investment will have little in the way of return. Or as the report shows, the firm may be recording a loss at this point in time.
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A comparison between the digital asset and gold from March to June 2020, the time period when the firm first invested in bitcoin, shows what the current value of the investment would be. MicroStrategy had nearly $2 billion in its bitcoin investment, which is currently up more than 376% in the span of one year. On the other hand, if the firm had put this $2 billion into traditional assets like gold, it would have lost 80% of its total value.
This is because gold has given negative return on investment in the last one year. Thus any investment in the property will result in loss. The success of Microstrategy’s bitcoin investment has also strengthened the company’s sustainable profit-wise. Not only is its investment outperforming gold, but the company itself has also outperformed gold in the market.
BTC price above $46,000 | Source: BTCUSD on TradingView.com
MicroStrategy’s shares have appreciated 428% in the year since the launch of its bitcoin fund. Both the NASDAQ and the S&P500 together outperformed. MicroStrategy is currently the leading corporate investor in bitcoin.
Featured image from CoinQuora, chart from TradingView.com